Oxycontin Inventor Destroyed? – Purdue Pharma Files for Bankruptcy
Purdue Pharma filed for bankruptcy protection this Sunday as part of a $10 billion deal that settles roughly half of the 2,200+ lawsuits regarding its role in the opioid crisis that has claimed more than 400,000 lives since 1999.
“This settlement framework avoids wasting hundreds of millions of dollars and years on protracted litigation, and instead will provide billions of dollars and critical resources to communities across the country trying to cope with the opioid crisis,” says Steve Miller, head of Purdue’s board of directors.
Purdue Pharma was founded in 1892 in New York and purchased by the Sackler family in 1952.
The company is famous for its painkiller OxyContin, an extended-release opioid first prescribed in 1996. In ads, OxyContin was described as “smooth and sustained pain control” lasting 12 hours. Officials claimed the drug was less addictive than other painkillers.
OxyContin is roughly 1.5 times stronger than morphine.
Purdue marketed its product to doctors by offering them incentives such as free trips and paid speaking engagements. By 2001, OxyContin had brought in nearly $3 billion in revenue.
Reports about addiction and abuse began to surface in 2000. In 2003, the DEA claimed that Purdue’s aggressive marketing methods had “very much exacerbated OxyContin’s widespread abuse.”
In 2004, West Virginia’s Attorney General charged Purdue for ‘deceptive marketing.’ In 2007, Purdue was fined $600 million for misleading the public about OxyContin’s potential for addiction. Three of the company’s top executives pleaded guilty to misbranding charges and were fined $34.5 million.
In 2012, the New England Journal of Medicine published a study which found that nearly 80% of those seeking help for heroin addiction had previously abused pharmaceutical narcotics – primarily OxyContin.
In 2016, as total revenue from OxyContin eclipsed $30 billion, an investigation revealed that Purdue’s executives had been aware of OxyContin’s potential for abuse from the very beginning.
Today, Purdue faces lawsuits from nearly every state and from more than 2,000 jurisdictions, hospitals, and Native American tribes. The Justice Department is conducting civil and criminal probes.
Purdue reached a $270 million settlement with the state of Oklahoma earlier this year.
The settlement reached last week will see Purdue restructured as a public beneficiary trust, with all profits going to the plaintiffs. Purdue’s addiction treatment drugs will be provided to the public at no cost.
The Sackler family will forfeit ownership of the company, contribute $3 billion in cash, and sell its UK-based pharmaceutical network (Mundipharma) – but will remain wealthy and will not be criminally charged.
Plaintiffs who refused the terms of the settlement have promised to pursue further litigation to recover additional money from the Sackler family (much of which is believed to be held offshore). A recent filing by the New York attorney general’s office revealed nearly $1 billion in wire transfers from Purdue to the Sackler family. According to Forbes, the family is worth nearly $13 billion.
“This apparent settlement is a slap in the face to everyone who was had to bury a loved one due to this family’s destruction and greed,” argues Pennsylvania Attorney General Josh Shapiro. “It allows the Sackler family to walk away billionaires and admit no wrongdoing.”
Purdue and its executives deserve to be punished, and I agree with Shapiro that the bankruptcy deal does not go far enough. And what about all the doctors who accepted bribes?
Hopefully the money from this deal will actually go to those in need (instead of being gobbled up by state governments) and the remaining plaintiffs will succeed in taking down the Sacklers.
Editor’s note: Its one thing to invent a wonder drug and later discontinue it because of the side effect, but its quite another thing to know that your drug is addictive (they knew this long ago) and continue to push the drug to where the primary market is addicts.
The Sackler family is massively guilty in this respect. The courts should go after not just the parents but also the children who benefited from this empire (even though they sancitmoniously claimed they have nothing to do with the running of the business).
Delray Beach, FL, near where I reside, was once the pill mill capital of the world. Former Governor Rick Scott put an end to this, but previous governors should have done it long ago. There are still more rehab clinics per square inch in this area than anyplace in America, and not a day goes by that you don’t hear of another overdose.